Thursday, March 18, 2010

BHP Billiton (LON:BLT) Bullish on Finalizing Rio Tinto (LON:RIO) Joint Venture

BHP Billiton Bullish on Rio Tinto Joint Venture

BHP Billiton (LON:BLT) says it's bullish on being able to finalize the joint venture with Rio Tinto (LON:RIO) for the iron ore production business.

Iron ore demand has increased this year, along with the prices, as steel companies battle for access to iron ore to build their products.

Rio would have a larger stake so BHP would pay them about $5.8 billion to level the stakes in the venture.

Concerns the Australian government will increase taxes to an extraordinary 40 percent is weighing on the deal, as well as other miners, who believe it could do a lot harm to the industry and economic growth, which would be stifled by the high taxes.

Other major hurdles include the deal being approved by the European Union, which somewhat opposed the attempt by BHP to acquire Rio Tinto a couple of years ago.

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